SignalFlow AI - Growth Edition
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Our Latest Quantitative Signal Service
Today we launched SignalFlow AI - Growth Edition, which is the latest incarnation of our SignalFlow machine-learning based quantitative signal services.
This is a major upgrade to our existing SignalFlow for QQQ service. If you are a current subscriber to SignalFlow QQQ, you will receive the new upgraded service at no change to your current subscription fee.
Now, let’s dive into how this service will work and how you may choose to use the signals as a subscriber. (If you’re new to quantitative signals, I suggest you start by reading this post).
About SignalFlow AI
The SignalFlow AI model is a proprietary machine learning model which uses multiple data feeds, primarily price, to build its knowledge of how highly liquid securities look when they are about to correct from a risk-on to a risk-off state. With each closing price that passes, the model has one more datapoint with which to increase its knowledge. The model also uses a relative strength method when considering multiple securities. So the capabilities of the model are (i) identify potential periods of weakness ahead for any liquid security and (ii) if it believes the overall market is risk-on, identify which of a list of tickers has the greater relative strength vs. the S&P500.
We take these core functions of the model and build on them to offer SignalFlow AI services in different flavors:
- Long-only S&P500 (signal outputs - hold cash or hold SPY)
- Long-only bonds (signal outputs - which bond ETF to hold, or hold cash)
- Long/short S&P500 and Nasdaq-100 (signal outputs - hold SPY, QQQ, SH, PSQ or cash)
- Sector rotation, helping our RIA subscribers rotate client capital through the strongest sector ETFs at any given time – with the goal of outperforming the S&P500 without taking undue risk.
Introducing SignalFlow AI – Growth Edition
The goal of the Growth Edition service is to identify compelling long-only return opportunities by (i) only deploying capital when the model believes the overall market is in a risk-on state and (ii) deploying capital into the top 3 ETFs from a list of around 10, based on its proprietary relative strength assessment.
In short, SignalFlow AI - Growth Edition is designed to help you identify the top growth ETFs when the model believes the market is in risk-on mode. Or to quote the creator of the SignalFlow model, Jay Urbain Ph.D., “the Growth Edition model helps you step on the gas in a risk-on environment”.
The service is simple to use. Each trading day at the close, subscribers receive the following signals:
- What state does the model believe the market is in risk-off, or risk-on?
- If the model believes the market is in a risk-on state, which are the top 3 ETFs it believes should be owned?
The list of ETFs that this service chooses from includes: SPY, QQQ, SMH, XLK, IGV, XME, GLD, GDX, plus BTC-USD and ETH-USD. The risk on / risk off decision is made based on the S&P500. (We have found that the S&P500 is the single best ‘carrier wave’ from which to deduce the risk environment).
How To Use SignalFlow AI – Growth Edition
Our subscribers use the SignalFlow AI services in a variety of ways. Here are the polar ends of the spectrum.
- Literal application of model outputs. Upon receiving the daily signal, trade exactly according to the signal. If the signal is ‘risk off’ and it was ‘risk off’ yesterday, you would be already in cash and would do nothing. If the signal was ‘risk off’ and it was ‘risk on’ yesterday, you would sell your holdings and go to cash. If the model is ‘risk on’ and provides a list of three ETFs it thinks superior, you would buy each of those three ETFs in equal dollar amounts. If tomorrow the model is ‘risk on’ but signals three different ETFs to own, you would sell all the ETFs and then buy the three new names in equal allocation using the capital you realized from the sale of your prior positions.
- Background chatter. Upon receiving the daily signal, treat it as one of a number of inputs into your thought process as to making discretionary buys & sells.
We operate a discussion channel in our Slack environment meaning you can always reach Jay or myself should you need clarity as to how to interpret outputs. The discussion channel has a sizeable, growing, warm community.
Back-Tested Returns
Backtesting is backtesting and it’s not the same as real trading. But we believe our methodology is sound. The SignalFlow models have handle the last 5-6 weeks of market volatility very well.
We think this Growth Edition of SignalFlow has a chance to be the best performing of the family of services. Backtested cumulative returns - see the third chart below - vs. the S&P - have been remarkable.
Underlying Model Upgrade
SignalFlow Growth Edition uses the SignalFlow 2.0 model, which aims to be more responsive to market changes than the original incarnation. We will be rolling out the 2.0 model across the SignalFlow family in the coming weeks.
How To Join
If you already subscribe to SignalFlow QQQ, just do nothing. The long-only “own QQQ or own cash” outputs have now been replaced by the above, ie. “own cash, or own ETFs A, B, and C”. We believe this to be a much superior service. You won’t pay a dollar more than you have been paying for the QQQ service.
If you aren’t a SignalFlow QQQ subscriber, and you’d like to join SignalFlow AI - Growth Edition, just click one of these links.
(If you aren’t sure whether you’re an Investment Professional for these purposes? Check 1.5 of our Terms & Conditions, here).
Any questions, please reach out to minerva@cestriancapital.com or use this contact form on our website.
Cestrian Capital Research, Inc - 16 May 2025.